Paramount Skydance CEO David Ellison is reportedly considering moving the company’s operations out of California if the state does not agree to settlement talks over its efforts to block the proposed $110 billion merger with Warner Bros Discovery.
According to Variety, Ellison has told senior Paramount executives that the company could begin the relocation process on October 1 if California Attorney General Rob Bonta does not agree to negotiations. Al Jazeera said it could not independently verify the report.
California is among 12 states suing to stop the merger, arguing that the deal would reduce competition in the US media and entertainment industry. The states say the combined company could control about 27 percent of theatrically released films and roughly one-third of basic-cable programming in the United States.
Paramount is reportedly considering moving its operations to Tennessee, Texas or Georgia, none of which are part of the antitrust lawsuit.
The dispute comes as California’s film industry faces a decline in production activity. A relocation by Paramount, and potentially Warner Bros Discovery if the merger is completed, could further affect employment and investment in the state.
The proposed merger has also faced opposition from the Writers Guild of America, which argues that the deal could lead to job losses, lower pay and fewer opportunities for writers. Analysts have estimated that thousands of jobs could be affected if the merger proceeds.
Paramount Skydance agreed in July to pause the merger while the states’ lawsuit continues. The company could face a $7 million daily fee if the deal is not completed by September 30, according to the merger terms.
Paramount Skydance and Warner Bros Discovery shares rose following reports of Ellison’s potential move, reflecting investor expectations that the company may take a more aggressive approach to overcoming opposition to the merger.
The proposed deal remains subject to legal and regulatory challenges, with the outcome likely to have major consequences for Hollywood, media competition and thousands of jobs.
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